Ferguson Enterprises Inc. (NYSE:FERG) is one of the best water infrastructure stocks to buy as AI data centers strain resources. On May 5, 2026, Ferguson reported first-quarter sales of $7.5 billion, up 3.6% year over year, while U.S. non-residential revenue rose 8%. Management said large capital project activity remained strong, with growth in shipments, open orders, and bidding activity.

The data center angle is unusually direct for a distributor. During the same earnings call, CFO Bill Brundage said data centers accounted for a little over half of Ferguson’s large capital project revenue. He also said large capital projects showed up principally in commercial mechanical, which grew 21%, and in part of Waterworks, which grew 14%.

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This is important because large AI data center campuses require coordinated waterworks, mechanical, HVAC, plumbing, PVF, valve, flow-control, wastewater, and fire-protection supply before they can operate at scale. Ferguson also completed two Waterworks acquisitions during the quarter: Technology Sales Associates and Chesapeake Environmental Equipment.

Ferguson Enterprises Inc. (NYSE:FERG) is a North American distributor of water, air, plumbing, HVAC, PVF, waterworks, wastewater, and related infrastructure products.

While we acknowledge the potential of FERG as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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